Tamihere loan spat off to court

JOHN TAMIHERE: Maori Council administration co-chairman, chief executive of Waipareira Trust, former Labour Party Cabinet minister.

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A dispute over potential Labour Party candidate John Tamihere's $500,000 home loan will proceed to a full hearing, with a High Court Judge ruling questions remained over who and how much the Waipareira Trust chief executive should repay.

Justice Pamela Andrews yesterday dismissed a summary judgment application brought by developer Brent Ivil's West Harbour Holdings against Tamihere at the High Court in Auckland.

The court heard the $500,000 loan, made in May 2008, enabled Tamihere to buy a $1.36 million home on the Te Atatu Peninsula he agreed to purchase three months earlier.

The funds were raised after Waipareira Trust waived a mortgage security it held over a townhouse which was then sold and then the proceeds loaned to Tamihere.

Lawyers acting for Tamihere argued it was unclear which Ivil entity should be repaid, and in any case the $500,000 should be offset by a $210,000 loan made by Tamihere's personal company to Ivil in February 2007.

According to the ruling, Ivil claimed Tamihere was pressing him to repay the loan by May 2008 so he could finalise the home purchase: ''Mr Ivil says that after entering into the agreement to buy the house, Mr Tamihere was in serious financial trouble, and desperate to find funds to settle the purchase. He says Mr Tamihere procured Waipareira to release its mortgage,'' the ruling said.

Justice Andrews said questions remained over the case and summary judgement proceeding were an inadequate venue to answer them.

''There is no documentation recording the loan to Mr Tamihere. I am satisfied that, just as there is a dispute as to who made the loan, and at what amount, there is a dispute as to what interest, if any, is payable. That dispute can only be resolved on the evidence, at trial,'' Justice Andrews said.

The friendship between Tamihere and Ivil, and their respective corporate entities, soured in August 2011 over a failed hotel development.

Litigation between the parties has been in the courts for two years, and West Harbour entered liquidation in March this year.

Waterstone Insolvency's estimates indicate Waipareira faces an expected shortfall of $2.2m on its $4.6m claim over the failed company.

West Harbour liquidator, Waterstone's Damien Grant who continued the summary judgment application after being appointed, said last night he intended to progress the $500,000 claim against Tamihere to a substantive hearing.